UPDATE 3-Kansas Supreme Court finds state underfunds schools

March 2 (Reuters) - The Kansas Supreme Court ruled on Thursday that the state’s system of funding primary and secondary public schools falls short of an adequacy requirement in the state constitution.

The high court said it was delaying enforcement of its unanimous ruling until the end of June to give the legislature time to respond.

It warned that if the state fails to come up with a funding system that complies with the constitution by the June 30 deadline, the court will move to void the current method of school finance.

Governor Sam Brownback said the legislature has already started to craft a new funding formula and that it was time to give parents “the opportunity and resources to set their child up for success through other educational choices” besides their local public schools.

“The Kansas Legislature has the opportunity to engage in transformative educational reform by passing a school funding system that puts students first,” the Republican governor said in a statement. “Success is not measured in dollars spent, but in higher student performance.”

Kansas spends more than $4 billion a year on schools, with most of the money coming from the state general fund. The supreme court’s ruling could add another $800 million, according to Alan Rupe, an attorney for the four school districts that filed the lawsuit.

The ruling comes at a bad time for the Kansas budget. Tax cuts enacted in 2012 have gouged a hole in the budget as revenue failed to meet monthly estimates, although February marked a fourth straight month that collections met or exceeded projections.

A move in the state legislature to boost revenue by raising tax rates and eliminating a business exemption failed last week when the Senate was unable to override Brownback’s veto.

Rupe said the state’s fiscal woes should not interfere with the requirement to fund education properly.

“I don’t know that the constitution provides constitutional rights only when we can afford to do it,” he said.

S&P Global Ratings cited the state’s structural budget pressures and reliance on one-time revenue measures when it revised the outlook on the state’s AA-minus credit rating to negative from stable last month.

Reporting by Karen Pierog and Tracy Rucinski in Chicago;
Editing by Matthew Lewis and Cynthia Osterman